April 5 (Bloomberg) -- Spectrum Pharmaceuticals Inc.
plunged the most in eight months after its experimental bladder
cancer drug apaziquone failed to prevent tumors from recurring
in two studies.

Spectrum dropped 9.4 percent to $11.06 at the close of New
York trading, its largest decline since Aug. 4. The Irvine,
California-based company has gained 19 percent in the last 12
months.

The drug developer wants to discuss the results with
regulators, Chief Executive Officer Rajesh Shrotriya said in an
interview today. The company plans to present pooled data from
the two trials to the U.S. Food and Drug Administration for more
guidance on how to proceed.

“There is a question whether the size of the study that
you designed can pick up the statistical significant difference
or not,” Shrotriya said. “Each study alone did not do it, but
when you put them together, then we found highly significant
statistical differences.”

Spectrum has enough cash on hand to finance additional
research if necessary, Shrotriya said.

Spectrum also said today it agreed to acquire Allos
Therapeutics Inc., maker of the cancer medicine Folotyn, in a
deal valued as much as $206 million. The transaction, which
includes contingent value rights for shareholders if the drug
reaches certain targets, will add to Spectrum’s earnings in the
fourth quarter.

Allos’s Folotyn, an intravenous treatment for T-cell
lymphoma, will be sold to the same doctors that Spectrum targets
with its own lymphoma drugs, Zevalin and Fusilev, Shrotriya
said.

Fusilev, an injection known chemically as levoleucovorin,
first won FDA approval in 2008 for patients with a bone tumor
called osteosarcoma. The agency cleared the drug for wider use a
year ago for patients with advanced colon cancer.